The bid submitted for Tribune Co. by billionaires Eli Broad and Ron Burkle expires this afternoon, but people familiar with the auction say they expect the Chicago-based media company to withhold a response for now while encouraging the pair to stay involved.
"I don't think you're likely to see the board say 'no' to anybody at this point," said a financial professional who had followed the process closely but asked not to be identified because the bidding was confidential.
Tribune declined to comment, although Chief Executive Dennis J. FitzSimons reiterated in an e-mail to employees Monday that the board expected to make a decision by March 31.
A major Tribune investor said last week that he found the Broad-Burkle bid to be attractive because it would involve an immediate $27-per-share cash dividend plus an infusion of $500 million in capital from the two entrepreneurs. Broad and Burkle valued their offer at $34 a share, they said in a letter dated last Wednesday to Tribune advisors that was reviewed by The Times.
The two billionaires have said nothing publicly and did not return phone calls Tuesday. However, experts said the deal appeared to be structured similarly to Burkle's 2005 investment in the struggling supermarket chain Pathmark Stores Inc.
Tribune, corporate parent of the Los Angeles Times, KTLA Channel 5, the Chicago Cubs baseball team and other newspapers and TV stations, also received bids last week from its biggest shareholder group, California's Chandler family, and from the New York-based private-equity firm Carlyle Group. The $4.7-billion Carlyle bid is only for Tribune's broadcast division and the Cubs, said a person familiar with the offer.
The Chandlers, in a letter to Tribune advisors that was filed with regulators last week, said their offer was worth $31.70 per share -- a tiny premium over the current stock price. The broadcast division would be spun off to shareholders in a deal valued at about $4.2 billion, and they also would be paid $19.30 a share in cash for the newspapers.
Although the Chandlers did not spell out their plans in their letter, they are expected to later sell the newspapers, which include The Times, the Chicago Tribune, New York Newsday and eight other papers.
